Morena v Federal Trading et al 2 1

1 IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA COMMERCIAL DIVISION AT DAR ES SALAAM MISC. COMM. APPLICATION NO. 23643 OF 2024 MORENA HOTEL LIMITED ………………………………………… APPLICANT VERSUS FEDERAL TRADING COMPANY LIMITED…………………….... 1ST RESPONDENT FEDERAL COMPANY LIMITED…………………………………… 2ND RESPONDENT PAGU LOGISTICS CO. LIMITED…………………………………. 3RD RESPONDENT AMANI KHAMIS CHUMA……………………………………………4TH RESPONDENT LELO POLE MMASSY……………………………………………….. 5TH RESPONDENT BANK OF AFRICA TANZANIA LIMITED………………………… 6TH RESPONDENT RULING Dec. 16th, 2024 & March 7th, 2025 Morris, J In this application, the applicant is challenging the resistance of the respondents, save for the last one, against vacant possession over Plot No. 10 - Morogoro with the Certificate of Title No. 183029/72 (the property). He filed his chamber summons under sections 55, 93 and Order XXI Rule 95 of the Civil P rocedure Code , Cap 33 R.E. 2019 (the CP C ). The application was supported with the affidavit sworn by Mabkhut 2 Slim Omary - the applicant’s principal officer. However, the application was strongly resisted by the respondents. Whereas the 2nd and 5th respondent filed the counter affidavit of Lelo Pole Mmassy, the 1st, 3rd and 4th respondent had Amani Khamis Chuma deposing in opposition of the application. I will start with a brief account of the facts of this application. Around 2019, the 6th respondent sued the 1st - 5th respondents under Commercial Case No. 109 of 2019 (the suit). The proceedings of the suit culminated in the parties’ consent judgment and decree being entered and extracted by this Court in November 2020. However, the decree was not satisfied by the first quintet respondents. Consequently, the 6th respondent applied for execution from which proceedings the property was sold to the applicant on 30.11.2023. The ultimate applicant’s possession of the property allegedly met resistance from the 1st - 5th respondents. Up to the time of filing this matter, the applicant had not accessed the property, hence this application. The application was heard by parties filing respective written submissions per the Court’s sanction of 16.12.2024. The submissions were filed timely. Parties were represented by learned counsel. For the 3 applicant was Advocate Christopher Malinga while Advocate Michael Kabekenga acted for the 1st, 3rd and 4th respondents; and Mr. Gove Chuma, learned counsel, represented the 2nd and 5th respondents. The 6th respondent, though under the representation of Advocates Karoli Tarimo and Happiness Karoli did not file either the affidavit in opposition or reply submissions against the application. For the application, apart from praying to adopt the supporting affidavit thereof; it was submitted by the applicant’s counsel that his client was a bonafide purchaser of the property through a legitimate public auction. It was also stated by him that the applicant obtained a certificate of sale for the property dated 21.05.2024 and the title deed number 183029/72. To the applicant thus, the respondents had no justification of not giving vacant possession of the property to him. He submitted further that, since the foregoing disposition was not set aside by the Court pursuant to Order XXI Rules 87, 88 and 89 of the CP C '; the applicant was entitled to the reliefs sought in the matter at hand in line with Order XXI Rules 93 and 95 (1) & (2) of the CP C . Accordingly, he reiterated the applicant’s prayer for the Court order so as 4 to remove the 1st – 5th respondents and to put him into possession of the property. In reply, the respondents’ submissions were to the effect that, the applicant was not entitled to the reliefs in the application because he did not pay the requisite auction amount for the property. They also maintained that the law requires that such money must be deposited into the judiciary account for further action. The respondents made reference to the letters of the Registrar of this Court (annexure LPM 6/7) to insist that the applicant did not pay the purchase price for the property in full. Hence, they were not compensated adequately. Moreover, it was contended by the respondents that eviction sought by the applicant must be based only on the ground that the respondents were resisting to hand over vacant possession of the property to the former without a just cause. Reliance hereof was on the case of Em m anuel E. M w akasege v Felix Andrew Sam ilan & 8 Others , Misc. Comm. Appl. No. 111 of 2023 (unreported) in which it was held that the bonafide purchaser would be put in possession of the property he bought under the cited law herein if, without any just cause, he is being 5 “resisted or obstructed by either the judgment debtor or any other person to obtain possession of the same”. Arguing along the foregoing holding, the respondents stated that their resistance was justified. In this regard it was submitted that in the absence of proof that the applicant paid for the property in full, his right to vacant possession was not attainable because he did not qualify as the bonafide purchaser. Likewise, it was argued that the auction that would have otherwise made him to enjoy such right was tainted with several irregularities. Referring to the depositions in the counter affidavits, the respondent asserted that the broker did not comply with the mandatory provision of the law before, at and post auction. The broker’s anomalies were stated to include: failure to follow the requisite procedures of publishing the auction advertisement; to indicate wrong/different names of the respondents in the prohibition notice, advertisement and proclamation of sale; to publish the notice in unpopular newspaper in Morogoro; failure to serve the notice of sale on the respondents; selling the property at the undervalued price; and the applicant’s failure to pay the full purchase price. To them, such anomalies were contrary to rule 25 6 of the Judicature and Application of Law s Act the Court Brokers and P rocess Servers (Appointm ent, R em uneration and Disciplinary) (Am endm ent) R ules, 2019; GN. No. 106/2019 (the Brokers’ R ules ). Another line of the respondents’ resistance was that the auction was improperly conducted because there was no valuation made pursuant to section 164(1)(a) of the Land Act , Cap 113 R.E. 2019 (the Land Act ); and/or payment by the applicant was below 25% of the established value, contrary to section 133(2) of the Land Act . To the respondents, the mentioned irregularities could not be ignored by the Court. Instead, they prayed that the Court was to investigate such misdeeds of both the applicant and brokers; and consequently, find that the respondents were not liable for eviction howsoever. In rejoinder, the applicant reiterated the arguments in the submissions in chief. Further, in specific response to the respondents’ contention, he contended that the respondents raise the matters which had been overtaken by events. He claimed that the auction was conducted in Nov 2023 but the latter opted not to challenge the sale under Order XXI Rule 88 of the CP C . To him, the respondents were 7 unjustified to invoke the contrary arguments at the present stage. Moreover, the applicant asserted that, after the Court issued the certificate of sale, the respondents were ineligible to challenge the sale through the current proceedings. The case of Edm und Aaron M w asaga v Leticia Vedasto Ngililea t / a Letisco Supplies & Another , Misc. Comm. Appl. No. 45 of 2023 (unreported) was cited hereof to buttress the applicant’s position above. It was added an argument that, the Court could not go back to the said contention for it was already functus officio in the light of the issued certificate of sale. On such basis, the applicant argued further that Em m anuel E. M w akasege’s case (supra), was accordingly inapplicable to the present matter. Conclusively, the applicant prayed for the reliefs in the application. Dispassionately, I have considered the factors regarding this application per the parties’ affidavits and submissions. It is a common ground that, the property was disposed of in execution of the decree that was obtained from the suit by the 6th respondent against the remaining counterparts. Further, the purchase of the property by the applicant was 8 through public auction. Moreover, the previous occupiers are still in possession of the property up to the present. On record, there is one major cause fronted by the 1st -5th respondents for them not to give vacant possession to the applicant. Such sole cause is that the disposition that led to the latter to ‘acquire’ the property was tainted with material irregularities and fraudulent documentation. To them, the purported public auction herein was unlawful and thus, could not pass any legal title/right of the property to the applicant enough to entitle him to be put in possession of such suit premise. Their insistency is pegged on the further argument that, in the absence of a lawful public auction, the 1st -5th respondent possess adequate just cause not to be evicted in line with Em m anuel M w akasege’s case (supra); sections 55 and 95 together with Order XXI Rules 95 and 96 of the CP C . I hereof agree with the subject respondents. The cited authorities above are categorical of the settled rule that, in the presence of a just cause; the person resisting or obstructing the purchaser of immovable property sold in execution of a decree from obtaining possession of such property can be protected. That is, for the applicant to succeed in pursuit 9 of the application for putting him in possession of the property he bought in execution of a decree, the resisting or obstructing party thereof should lack the just cause. The pertinent question now is if the 1st – 5th respondents manifested a just cause in the matter at hand. Evidently, the CPC does not define what a just cause in the context of the cited provisions. However, in my swift search, the term “just cause” entails existence of a valid, legitimate or reasonable ground for taking action or not doing something. According to the Black’s Law Dictionary , 9th edition, the term justa causa (just cause) equates to a “lawful ground” or “good cause”. The opposite thereof is described as having malice or being substantially certain to cause injury to another. In the same context thus, a good cause is defined as; “A legally sufficient reason. Good cause is often the burden placed on a litigant (usu. by court rule or order) to show w hy a request should be granted or an action excused” (bolding done for emphasis). If it is to apply the excerpt above to the present matter, the Court would be invited to interrogate two equally critical aspects. The first is, 10 to whom the burden of demonstrating that the person resisting or obstructing the applicant’s entry into the just-bought property lies. I will start by discussing this point before going to the next one. According to Order XXI Rule 95 of the CP C , a person who is resisted or obstructed to possess the property is required to apply to the court “complaining of such resistance or obstruction” following which application the court makes the necessary investigation by summoning the resisting or obstructing person “to appear and answer the same”. Further, Order XXI Rule 96 of the CPC provides that “the resistance or obstruction was occasioned without any just cause” by the person against whom the application is made the court proceeds to remedy the resistance/obstruction complained of. From the foregoing provisions, the task of the decree holder or purchaser of the property is to complain to the Court – only that. Then, the court investigates the complaint upon getting the defence (if any) from the person against whom such complaint is made. That is, the latter is supposed to answer the application. Sensibly, he must exhibit that his unyieldingness thereof is lawful. This examination accordingly settles the first limb of the interrogation. The onus of proving that there exists a just 11 cause for resistance or obstruction lies upon the person against whom the complaint is filed. Hence, in this matter, the 1st – 5th respondents were under such obligation. Second, in line with the foregoing conclusion; the Court needs to establish whether the 1st – 5th respondents discharged the above obligatory burden. As alluded to earlier on, their defence theme was bonded in the allegation of illegality of the public auction. Stoutly, the arguments by the respondents were directed towards challenging the integrity of the disposition herein. In other words, they were insistent that the applicant did not acquire the good title to the property because the process through which he would have otherwise acquired it lawfully, was tainted with fraudulent procedures, material irregularities and illegitimate documentation. Accordingly, their unanimous conclusion was that the applicant did not qualify to a bonafide purchaser of the property. For this Court to dutifully resolve if the respondents’ ground above constituted a just cause or not, I will make a number of observations. One, the law allows a judgment debtor or a person whose property was wrongfully sold in execution of the court decree to challenge such sale. Hereof, Order XXI Rule 88 of the CP C is definitive that the impugned 12 sale may be set aside by the court on the ground of material irregularity or underlying fraud. See also, M illicom Tanzania Nv v Jam es Alan R ussels Bell & Others , Civ. Rev. No. 3 of 2017; The Attorney General vs W afanyabiashara Soko Dogo Kariakoo Cooperative Society Ltd & 2 Others , Misc. Civ. Appl. No. 606 of 2015; Archard F. R ugaim ukam u & Others v Joyce B. Burton Lusige & Others , Comm. Case No. 51 of 2005; and CRDB Bank Ltd v John Kagim bo Lw am bagaza , Comm. Case No. 10 of 2000 (all unreported). Thus, for the sale to be set aside, the person alleging the anomalies stated in the law, must apply to the court to pursue such relief. In the present matter, there is nothing on record to substantiate that the respondents obtained the order of setting aside the sale. At the very least, they did not exhibit that they were in process to challenge the sale under the stated provision. In other words, it was not deposed that there was any pending application in the Court to challenge the impugned sale. Two, the mandate to hold that the sale was improperly conducted and ultimately set it aside belongs to the court. Thus, the allegations by the judgment debtor or a person with interest in the sold immovable property that such sale was unlawful must be confirmed by the court. It 13 is not upon the complainant or respondents or both to conclude that the sale was illegitimate or fraudulently conducted. Three, in the deed of settlement-cum-consent judgment together with the decree therefrom (for which I have taken judicial notice under sections 58 and 59 of the Evidence Act , Cap 6 R.E. 2022); the 1st -5th respondents (judgment debtors) unequivocally allowed the 6th respondent (decree holder) to attach and dispose the property in the event of default by the former. Precisely, paragraph 12 of the decree states as follows: “In the event of default of payment of any instalment as agreed herein, the plaintiff (6th respondent in this matter) will proceed with attachment of all remained (sic) securities pledged by the defendants (presently, 1st - 5th respondents) and in the event the securities will not sufficiently settle the outstanding amount the plaintiff will proceed against the defendants jointly and/or severally for settlement of the outstanding balance” Four, the applicant submitted that this court is functus officio to entertain the present contention because it issued the certificate of sale. I distance this Court from such argument. This principle was incorrectly introduced in the matter at hand. In fitting cases, the sale of the 14 judgment debtor’s property in execution of the decree will be set aside if statutory conditions are fully proved to the court. This is notwithstanding the fact that the court will have sanctioned attachment, proclamation of sale and issued the certificate of sale. In law, questions arising from execution of decrees are exempted from the functus officio doctrine because at that stage, the court will be enforcing its orders. Hereof, I am aligning myself to the holding in Karata Ernest and Others v Attorney General , [1997] TLR 63; and Shahan Said Nyange v M ary P aulo , Civ. Appl. No. 28 of 2022 (unreported). Five, the respondents were also fervent by contending that the applicant did not qualify as a bonafide purchaser of the property. However, the latter resisted such argument by stating that he honestly complied with all the requisite procedures before and at the time of purchase of the property. According to Suzana S. W aryoba v Shija Ndalaw a , Civ. Appeal No.44 of 2017; John Bosco M ahogoli v I m elda Zakaria Nkw ira and Others , Land Appeal No. 101 of 2016; and M ariam Om ari Zahoro v K CB Bank Tanzania Lim ited & Others, Land Case No. 320 of 2017(all unreported); a person acquires the status 15 of the bonafide purchaser if his purchase of something is carried out in good faith and with sufficient belief that he/she will conclusively acquire the ownership rights thereafter because of the absence of any reason to think otherwise. Now, whether or not the applicant satisfied such condition regarding the property; the present matter is not the suitable proceedings to examine such aspects. As alluded to above, the appropriate application for the respondents hereof is pursuant to Order XXI Rule 88 of the CP C . Apart from the grounds and disputations discussed above, the counsel for the 1st, 3rd and 4th respondents advanced another contention against the sale of the property. He argued that the Land Act (supra) lays down precise procedures to be complied with before the mortgagee can sell the mortgaged property. In particular, sections 133 and 164 thereof were cited. With adequate respect, such submissions were irrelevant and misplaced on a number of reasons. To begin with, the sale impugned in the matter at hand emanated from execution of the court decree not the rights of parties under the mortgage transactions. Further, the argument arose from the bar without corresponding affidavital depositions. In law, submissions from the bar are never 16 evidence. See, for instance, the R egistered Trustees of the Archdiocese of Dar es Salaam v. The Chairm an, Bunju Village Governm ent & 11 Others , Civil Appeal No. 147 of 2006 (unreported). In addition, if this tenet of defence was a fit contention to process further, the procedure to be adopted by the respondent is different from the present proceedings. Perhaps, the respondent would have considered to file a normal suit against the alleged mortgagee and his associates, if any. Be that as it may, the applicant therein would feature as one of the defendants. For the forgoing circumstances, evaluation of evidence and analysis of legal aspects; I hold that the issue raised herein is answered negatively. Consequently, the application is granted. For avoidance of doubts, pursuant to Order XXI Rule 96 of the CP C ; the Court finds that resistance or obstruction by the 1st -5th respondents was occasioned without any just cause. Subsequently, I order that the 1st -5th respondents should hand over Plot No. 10 - Morogoro with the Certificate of Title No. 183029/72 to the applicant within thirty (30) days of this ruling. The applicant has also earned costs for this application. It is so ordered. 17 C.K.K. Morris Judge March 7th, 2025 Ruling delivered this 7th day of March 2025 in the presence of Advocate Naima Mongi holding the briefs of Advocates Christopher Malinga for the applicant and Peter Swai for the 6th respondent. Messrs. Michael Kabekenga and Gave Chuma were respectively present for the 1st, 3rd and 4th respondents; and the 2nd and 5th respondents. C.K.K. Morris Judge March 7th, 2025